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Organigram lawsuit heads to court (or perhaps, a settlement)

Cannabis plants grown at Organigram's facility in Moncton, N.B. (Ron Ward/Canadian Press files) (CP)

Cannabis plants grown at Organigram's facility in Moncton, N.B. (Ron Ward/Canadian Press files)

A lawsuit against New Brunswick cannabis producer Organigram has cleared another hurdle, but the legal action still has a long way to go before it gets resolved.

The lawsuit was originally filed in March 2017, after Organigram issued two recalls for certain lots of cannabis. The recalled product tested positive for one or both of two different pesticides that aren't allowed for cannabis production: myclobutanil and bifenazate.

Now, the lawsuit has been certified as a class action by Nova Scotia Supreme Court Justice Ann Smith. In a statement, Organigram said it's weighing whether to appeal the certification and "intends to vigorously defend itself against this class action."

If Organigram doesn't successfully appeal the certification, the lawsuit is destined for court. There, the plaintiffs' lawyers will argue that Organigram's actions leading up to the recall were negligent and breached a variety of laws.

"They all revolve around the one issue, of the fact that bifenazate and myclobutanil were found to have been in at least some of the lots of recalled product, and it led to the requirement by Health Canada that they recall all of the product manufactured and sold within a certain period of time," said attorney Maddy Carter on Tuesday.

Dawn Rae Downton, a medical cannabis user who's the lead plaintiff in the class action, previously told CBC Radio that using the recalled marijuana caused her to experience "constant nausea" and other ill health effects.

Carter says 176 other people have been in touch with her law firm about the class action suit, which she said will seek compensation for "any sort of physical impact that have been suffered by class members as a result of consuming the product."

Compensation will also be sought for Organigram customers who bought the recalled product and "didn't actually receive what they thought they were paying for," said Carter, who estimates there could be between 4,000 and 5,000 such people. (Organigram says it "has already voluntarily reimbursed many of its customers for this recall via a comprehensive credit and refund program.")

Finally, Carter said, the plaintiffs will also be seeking punitive damages against Organigram.

"It's of a different nature than compensation, it's actually for reckless or callous conduct on the part of the defendant," she said.

The plaintiffs' allegations against Organigram have yet to be tested in court.

If and when they are, a trial could reveal new details about the inner workings of a licensed cannabis producer during a product recall. According to Carter, the next phase of the lawsuit will involve a search for documentary and oral evidence as both sides build up their cases, evidence that would presumably be presented at trial.

But there's a good chance this case might not even get to trial, according to attorney Matt Maurer, vice-chair of the cannabis law group at Torkin Manes. (Maurer is uninvolved with the Organigram lawsuit.)

"Getting a class action certified is not easy, and just based on the nature of the difficulty of the certification phase, the cost of going through to a trial, and the potential damages… Usually, once a class proceeding gets certified, a settlement gets reached," said Maurer.


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